NRI Insurance Plans: Policies and Features

Insurance policies are there to secure people financially. Not only Indians, NRIs living abroad are also eligible for different insurance plans offered by insurers in India. Let us understand the various NRI policies and features, in this post 

Be it an Indian citizen or a Non-Resident Indian (NRI), everyone wants to secure the lives of their family members financially. The NRI insurance plans allow the Indians living in different countries to secure them and their families with a stable financial future. Before proceeding further in the post to understand the NRI plans, let us first understand what is the meaning of NRI?

What does NRI mean?

NRI means a Non-Resident Indian, who is an Indian citizen working in a foreign land and lives there for most part of a financial year.

An NRI lives in India for fewer than 182 days during a fiscal year. This is a person who has gone to a foreign land to earn a living by getting a job or working for a business.

>>Important Factors to be Considered by NRIs Before Buying a Life Insurance Policy in India

Who is an NRI as per Indian law?

If you ask – who is NRI or What is NRI – NRI is a person who is an Indian Citizen living and earning livelihood in a foreign country for over 183 days in a preceding financial year. NRIs can benefit from various insurance plans available in India to secure themselves as well as their families.

Classification of NRIs

NRIs are people living abroad and they are classified into three major categories, such as Non-resident Indians (NRIs), Persons of Indian Origin (PIOs) and Overseas Citizens of India (OCIs).

Who does PIOs and OCIs mean?

PIO or Persons of Indian Origin is a person who was born in India. He/she is an Indian either  by birth or by descent. These individuals belong to different countries and hold passports of other countries too. These people were issued an id card by the Indian Government previously. However, the Government of India later withdrew the scheme of offering PIO Cards and merged the concept with the Overseas Citizens of India or OCI Card Scheme from 15 January, 2015.

OCIs are people of Indian origin who reside in a foreign land except for Pakistan and Bangladesh and are eligible for a lifetime visa.

Eligibility Criteria for NRI to Proceed with a Legal Activity in India

Depending on what NRI category you belong to, a NRI or OCI cardholder could proceed with any legal activities in India, it is important for them to meet the eligibility criteria.  There are certain documents that serve as proof of identity for any NRI as mentioned below:

1. Indian Passport:

It is important for an NRI to hold the Indian passport issued by the government of India.

2. Citizenship:

NRI should be a citizen of India as per the 1955 Act of Citizenship. Hence, either the parents or grandparents of the NRI have to be Indian citizens. So, either the NRI, his/her parents or his/her grandparents must be Citizens of India.

3. Spouse :

You must be the spouse of a citizen of India or NRI man/woman who meets the criteria stated above.

Can a NRI Get Insurance Policy in India? If so, how? If so, how?

Like the resident Indian citizens, Non-Residential Indians or NRIs can also apply for insurance plans in the country. Insurance, especially term insurance, is a financial protection that an individual buys for his/her family for them to lead a normal life even if there is a mishap like sudden demise of the policyholder. Term insurance are long term plans available at cost-effective prices and offer high returns to the beneficiary.

To apply for an insurance policy, a NRI can appeal in two ways.

• A NRI can buy an insurance policy during his/her visit to India
• They can buy a policy from their current place of residence/country using Mail Order Business. In this case, the policy will be verified by a notary, an official of the Indian Embassy, along with an Indian diplomat. In case of students, they can get the verification done by the dean of their college/university.

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NRI Insurance Plans – Features

Most insurers in the country allow NRIs to avail their products and policies. However, the NRI policy terms and conditions might vary from the policies offered to regular Indian residents. Let’s check features  of some NRI policies.

1. Premium Amount:

NRI insurance policies may not have any fixed premium amount. Rather the premium or the initial payment under a NRI scheme depends on different factors including the term of the particular plan chosen, policy tenure, the coverage amount assured under the plan, the premium payment option and selected rider options (if any) etc.

2. Policy Tenure:

The NRI policy tenure may range from 6 months to 25 years depending on the plan. The plan eligibility starts from the age of 18 years and goes up to the age of 60 years. However, the policy term also depends on the other terms and conditions under the policy.

3. Sum Assured:

The Sum assured under a NRI policy might vary as per a particular plan. It may start from lakhs and go up to crores. The Sum assured is paid to the beneficiary of the policyholder when the insured passes away during the term of the policy.

4. Grace Period :

NRI policies have the advantage of grace period that can be availed if the NRI miss the date of premium payment. He/she can avail the facility to pay the unpaid premium within the grace period. If not done, the policy is likely to get terminated.

5. Payment of Premium Amount:

Indian NRI can pay the premium amount using the facility of Internet banking. For this, the policyholder must have a bank account in any of the approved banks with internet banking facility. The NRI making the payment should be well aware about the terms and conditions of such a transaction before making the payment.

6. Tax Benefits

Like residents of India, NRIs are also allowed tax benefits under Income Tax Act of India. However, certain countries (where the person works) might charge tax on maturity benefits received under a NRI plan.

NRI Insurance Plans – Required Documents

There are several documents asked by the insurance company to complete the procedure of buying an insurance, such as;

• Proposal form
• Identity proof
• Age and Income proof
• Attested copy of passport
• Health status report
• First premium amount

In case the policy is bought through Mail Order Business, the insurer might seek for extra documents, such as an application form, copy of passport, income proof, and age and address proof.

Top 5 Term Insurance Plans for NRI

Here’s 5 best term plan by renowned insurers in India that NRIs can avail:

Popular Health Insurance Companies 2023

To Conclude

NRIs and OCIs can avail insurance policies to have a peaceful and secure life. When it comes to term policies, there are many options as mentioned above. It is good to avail all information regarding the policies to avail the best plan and provide supreme security to you and your family in India.

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